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The extra £1 billion UK government commitment to help disabled people with jobs is not consistent with new money from the Treasury, and while addressing other priorities such as youth unemployment, it raises questions about the minister’s ability to achieve divisive welfare reforms.
The Minister has parsed the benefits of illness and disability as a “moral mission” to help people do their jobs rather than entrusting them to a life of profit.
They say they have £1 billion in new funds per year between 2029-30, ensuring the support of all benefits claimants in their health who want to seek help or return to work.
However, just £400 million of this will appear in the stream between 2028-29. Last year was covered by the departmental budget set out in the spending review earlier this month. Expenditures are to jump to reach the £1 billion promised in the final year of Parliament.
“Our goal is to combine this new investment with existing capabilities to establish large, clear and simple offers, health and skills support for people with disabilities and health conditions,” he said in an impact assessment of the government’s welfare reforms published last week.
However, the overall budget for the DWP on the day-to-day operation of the welfare system will increase essentially by 0.4% per year over the three years intended to deploy this additional support.
“The employment support revolution has pledged to reduce sharp disability benefits, which must be funded by an inherently frozen daily budget,” analysts at the Resolution Foundation said.
On Thursday, MP Vicki Foxcroft resigned as a labor whip in protest of the government’s plans to cut disability benefits. She said that instead of cutting profits, she could address the rising welfare bill, “it could be done by supporting more people with disabilities in the workplace.”
Over 100 Labour lawmakers have expressed concern about reforms, but it is not clear how many people will vote for the bill next month.
The DWP has yet to show what shape its new employment support will take. By the fall, he hopes to persuade the office for budgetary responsibility to help new support lead to significant employment benefits, saving welfare and widespread benefits for society.
OBR officials were skeptical of the potential for a major return from the back to the workplace, saying in March the proposal would not be costly without details.
“My past experience is that it’s extremely difficult to get really big results from an employment support program,” Tom Josephs, a member of OBR’s Budget Responsibility Committee, told MPS earlier this year.
Meanwhile, analysts say that commitment to additional support for people with health conditions limits other priorities, particularly the ability of children aged 18 to 21 to tackle “youth guarantee” “youth guarantee” for access to apprenticeships, training and employment support.
“I think other things will be narrowed down,” said Stephen Evans, CEO of Learning & Work Institute Think-Tank, adding that funds for long-term unemployed support and youth assurance could be at risk.
The DWP refused to say whether other services would be cut to meet its £1 billion commitment. He said that improving efficiency will allow “finances to prioritize employment support.”
The department is currently spending £275 million a year on employment support for people with illnesses and disabilities. The £1 billion increase will consume a tenth of all day-to-day spending on service delivery and almost a third of employment support. This is expected to rise to £3.5 billion by 2028-29.
The DWP declined to say how much they are spending on current employment support, or whether support for other groups would be reduced to meet their £1 billion commitment. The increased efficiency will allow them to “prioritize funding towards employment support,” and the eight local pilots of Youth Guarantee, funded for £45 million in their first year, said the company will continue.
The DWP said it was “determined to create a welfare system that would support people outside of work and poverty.”
